European Parliament resolution of 2 February 2012 on EU development cooperation in support of the objective of universal energy access by 2030 (2011/2112(INI))

The European Parliament
,

– having regard to the designation of 2012 as the International Year of Sustainable Energy for All by the United Nations General Assembly in recognition of the importance of access to energy for sustainable economic development and the achievement of the Millennium Development Goals (MDGs)(1)
,

– having regard to UN Secretary-General Ban Ki-moon's launching of a Sustainable Energy for All Initiative(2)
,

– having regard to UN Secretary-General Ban Ki-moon's setting up of an Advisory Group on Energy and Climate Change (AGECC) and to its recommendations of 28 April 2010, in which it identified as priorities the international target of universal access to modern energy services for all by 2030 and the reduction of global energy intensity by 40 % by 2030(3)
,

– having regard to the World Energy Outlook 2011 of the International Energy Agency (IEA), which emphasises that worldwide about 1,3 billion people have no access to electricity and, furthermore, that approximately 2,7 billion people are without clean cooking facilities,

– having regard to the high-level international conference on Energy for All – Financing Access for the Poor held in Oslo, Norway, on 10-11 October 2011 and to the launching of the International Energy and Climate Partnership – Energy+ Initiative,

– having regard to the conclusions of the Council of the European Union of 19 May 2009 on access to sustainable energy resources at local level in developing countries, which recalled that ‘access to sustainable energy sources and modern energy services is a prerequisite for economic growth and social development, as well as for the achievement of the Millennium Development Goals (MDGs),’ and that ‘a focus on sustainable energy will consolidate progress towards the MDGs and will contribute to address the global crisis and to mitigate climate change’,

– having regard to the Communication from the Commission to the Council and the European Parliament of 17 July 2002 on energy cooperation with the developing countries (COM(2002)0408),

– having regard to the Communication from the Commission to the Council and the European Parliament of 26 October 2004 on the future development of the EU Energy Initiative and the modalities for the establishment of an Energy Facility for ACP countries (COM(2004)0711),

– having regard to the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 13 October 2011 on increasing the impact of EU Development Policy: an Agenda for Change (COM(2011)0637),

– having regard to Rule 48 of its Rules of Procedure,

– having regard to the report of the Committee on Development (A7-0442/2011),

A. whereas worldwide about 1,3 billion people – 84 % of whom live in rural areas – have no access to electricity; whereas, furthermore, 2,7 billion people are without clean cooking facilities(4)
, a situation that creates indoor smoke which is responsible for over 1,4 million premature deaths per year, making it, after HIV/Aids, the second most frequent reason for premature deaths worldwide(5)
; whereas the current lack of access to modern energy services in many poor countries has led to gender inequality and particularly disadvantages women and children,

B. whereas access to energy is essential to the realisation of several of the rights contained in the 1966 International Covenant on Economic, Social and Cultural Rights and other international human rights and environmental legal instruments,

C. whereas the MDGs will not be achieved unless substantial progress is made on improving energy access, which requires an estimated annual investment of USD 48 billion by 2030, which is equivalent to around 3 % of the global investment in energy infrastructure projected over the period to 2030 and would result in a modest increase in CO2
emission of 0,7 % by 2030(6)
;

E. whereas the use of renewable energy technologies is essential for developing countries to reduce their dependence on fossil fuel imports and related price volatility; whereas large-scale renewable projects (such as hydro or energy crops) can also have severe social and environmental consequences for the local population, i.e. on water or food security; whereas a careful assessment of the environmental impacts of renewable energy technologies is therefore an important prerequisite for donor finance,

F. whereas access to modern, sustainable energy services for all means access to the full range of energy services (not just electricity) needed and wanted, for example lighting, cooking and water heating, space heating, cooling, access to information and communications, and energy for productive uses and income generation;

G. whereas only 8 % of the USD 409 billion granted in fossil-fuel subsidies in developing countries in 2010 went to the 20 % of the population with the lowest income(7)
;

H. whereas the results of the Energy Development Index correlate strongly with those of the Human Development Index on life expectancy, education, per capita GDP and other standard of living indicators;

I. whereas in Sub-Saharan Africa nearly 70% of the total inhabitants do not have access to electricity; whereas population growth has outpaced electrification and the number of people without access to electricity has increased,

J. whereas in LDCs in particular only a small minority of the population has access to the grid; whereas grid access will not reach the whole population in the foreseeable future, making decentralised solutions such as small-scale, off-grid and mini-grid energy solutions the only viable way to provide universal energy access in the years to come;

K. whereas respect for the rule of law and strong governance are key factors that should be promoted in order to attract the private investment needed to fully achieve universal access to energy,

L. whereas the last Commission communications on the topic of energy in development cooperation were issued in 2002 and 2004;

1. Stresses that although there is no Millennium Development Goal specifically related to energy, access to modern, sustainable energy services for all (hereinafter ‘universal energy access’) is a prerequisite for achieving the MDGs; believes therefore that energy should move to the forefront of the debate on eradication of poverty, while ensuring that increased access to modern energy services is consistent with sustainable development; urges the Commission to issue a communication on development cooperation in support of universal energy access for the year 2012, which has been dedicated to this issue by the UN;

2. Urges the Commission and the Member States to endorse and commit to supporting the (UN-created) international target of universal energy access by 2030, and to align their policies and development cooperation with this objective;

3. Underlines that maximising the use of renewable energy resources represents the ideal path for the international community to take in achieving universal access to modern energy services, while combating climate change; calls on the Commission to develop an action plan to mainstream the objective of universal energy access into relevant EU policies, as well as into all sectors of development policy, such as agriculture, industry, trade, health and water, and to ensure there is coherence across policies and sectors for the universal energy access objective;

4. Welcomes the mention of energy as one focal point of the ‘Agenda for Change’ and expects the Commission to act accordingly; calls on the Commission neither to subordinate energy access to, nor to mistake it for, the other focal points of energy security and climate change that are also mentioned;

5. Encourages the establishment of a specific ‘energy and development’ programme, with special focus on universal energy access, within EU development cooperation;

6. Notes that experiences have shown that centralised power capacity and grid extension targets have often failed to improve energy services for the poor; stresses, therefore, the need to support renewable decentralised solutions, such as small-scale, off-grid and mini-grid energy solutions, to reach all parts of developing countries' populations, particularly poor and rural populations; calls on the EU to target its efforts, financially and technically, towards these small-scale solutions to energy poverty in remote areas;

8. Underlines that the Energy Facility is internationally one of the very few financial mechanisms that provides funding for small-scale renewable energy solutions, and calls on the Commission to continue and extend funding for this kind of project in the next financial period from 2014 on;

9. Calls on the Commission to evaluate the impact of investments supported by the Energy Facility on improving access to basic energy services for people living in poverty, and to improve the efficiency and effectiveness of the Energy Facility's successor in the new financial period after 2013 accordingly;

10. Stresses that, if implemented correctly, the use of renewable sources to provide energy services can offer an economic solution in developing countries with benefits to health, the environment and local development; stresses, however, the need to take into account the environmental impact of the use of renewable energy to improve universal access to energy, especially in the case of hydropower, biomass or agrofuels;

11. Calls on the EU to develop clear guidelines on environmental sustainability criteria for renewable energy projects financing; calls on the Commission to make the use of decentralised renewable energy or sustainable low-carbon/high energy efficiency a priority condition for support of new energy projects;

12. Underlines the role that private companies should play in allowing developing countries to reach the MDGs, giving particular consideration to universal access to energy; highlights moreover the importance of supporting the development of financial resources and technological proficiencies adapted to low-income markets, in particular through the stronger involvement of private companies in national and international institutional partnerships;

13. Encourages the Commission and the Member States to support, through development cooperation and the Energy Facility, the transfer of technologies, including technical knowledge, information, and good practices, appropriate for the delivery of modern energy services to poor people, between partner countries in the South and between Europe and the South, devoted to capacity development, including twinning, staff exchange and practical training, in order to assess and absorb technological options; encourages also the transfer of energy efficiency technology in this regard to enable energy to be used in the most productive way, so as to maximise the energy services that a given amount of energy can offer;

14. Calls for special attention to be paid to productive uses of energy in project/programme development as well as financing, as a key mechanism for socio-economic promotion and income generation;

15. Underlines that effective partnerships between the public sector, the private sector, communities and local governments will be necessary to expand access to sustainable energy services; calls on the Commission to use, wherever possible, a market approach to new/innovative energy solutions, for example by fostering local production, facilitating their introduction onto the market or providing market information, in order to ensure local ownership and sustainability; calls, in particular, on the Commission to promote governance capacity building to enable replicability of small-scale energy service projects through the promotion of SMEs;

16. Believes that private investment and its participation is fundamental to fully achieve universal access to energy; calls therefore on the Commission to promote the rule of law in all its aid actions, particularly in the least developed countries;

17. Calls on the EU Delegations to provide information on taxes, incentives and regulatory requirements in developing countries to those EU companies who want to invest in the energy sector;

18. Calls on the European Commission to facilitate the sharing of best practices concerning the most efficient incentives for facilitating the expansion of energy infrastructure in developing countries;

19. Encourages support for the development and promotion of sound policy and legal frameworks and of technical standards that strengthen local capacity and generate confidence among private-sector investors, including the mobilisation of local investment sources;

20. Underlines the pivotal role of public funds from partner governments, international financial institutions and ODA in leveraging the necessary private investment; underlines also that EU aid for improving access to energy should support local economies, green jobs and poverty reduction and must not be tied to the involvement of, or used to subsidise, EU businesses;

21. Recognises that the public sector alone will not be able to provide all the financing needs required to expand energy access; points out, in this respect, the importance of private investors and market-oriented reforms in the energy sector; underlines, however, that increasing focus on the use of public-private partnerships and attracting funds from private financiers may adversely diminish the financial attractiveness of local renewable energy projects, since such projects are less ‘bankable’ than major, grid-connected projects, which often serve large industries; underlines, therefore, that the ultimate responsibility for ensuring access to universal services, especially affordable energy for poor and remote populations, remains that of the state;

22. Highlights the fact that there are numerous ways for partner governments to further universal energy access through legislation, regulation, contracts or licensing by imposing universal service obligations, tailored to the country's needs and possibilities, such as:

review of counterproductive subsidies, taxes and duties, for example a shift from pro-fossil to ‘pro-decentralised-renewable’ in order to improve energy access and energy efficiency,

–

liberalising operators' entry to unserved areas,

–

fiscal incentives to facilitate expanded infrastructure;

–

measures to ensure that available energy is used as efficiently as possible;

23. Calls on the developing countries to commit seriously to the goal of universal energy access, and recommends increased assistance to ministries of energy in developing countries to enable them to make the case for support – in the new financial period – for universal energy access, including the development of long-term sustainable energy strategies and improved regional cooperation in energy matters;

24. Highlights the importance of transparent, democratic participation by civil society, local authorities and regulators in the energy sector, to enable them to supervise the provision of universal energy access, and also in order to ensure good governance and fair competition and to curb corruption;

25. Urges the national parliaments of developing countries and NGOs to play their proper role in ensuring and monitoring transparency, democratic processes and a stable legal environment;

26. Notes with concern that the Africa-EU Energy Partnership (AEEP) and its sub-programme for renewable energy seems primarily to focus on large projects and interconnectors with less emphasis on local energy solutions; urges the EU to refrain from developing a top-down approach on developing energy infrastructure, bearing in mind that large-scale infrastructures may not suit the economic and social structure of the country and fail to provide energy access to the poor, for whom smaller local energy sources are usually more appropriate;

27. Encourages the EU to dialogue with partner governments and civil society in developing countries in order to ensure that both national energy policies and poverty reduction strategies take account of universal energy access;

28. Asks for dialogue with partner countries and regional bodies to include specific consideration of the benefits of including the development of cooking energy services in national and regional development plans, and for the partner countries and regional bodies to be encouraged to engage in dialogue with local authorities and non-state actors involved in the field of household energy (cooking) with a view to determining how best to ensure significant scale-up and to reducing the number of deaths from respiratory diseases; encourages the use of more efficient cooking devices, as the traditional burning of large quantities of biomass on open fires has a detrimental impact on health, particularly for women and children, as well as negative impacts on deforestation;

29. Asks the Commission to report annually on progress towards achievement of the universal energy access target, having established reliable indicators, and on the contribution that EU development cooperation has made to this;

30. Advocates that the Commission's and the Member States' support for energy service development should be based on an assessment of the relative financial cost and performance of all options, taking into account contributions to MDGs and national development objectives, as well as the relative costs and benefits of decentralised and centralised energy systems;

31. Emphasises the importance of integrating the MDGs - in particular those related to poverty as access to affordable energy services is only possible by reducing the number of people living on USD 1 per day by 2015 - into the national energy strategies of developing countries;

32. Asks the Commission to review and use accordingly the potential sources of finance from climate-change- and carbon-market-related sources for investment in universal sustainable low-carbon energy access for the poor;

33. Calls on the Commission to support new results-based approaches in the energy sector, such as results-based financing, cash on delivery or output-based aid, which are currently also being tested by other donors, thus highlighting the importance of demand-driven aid (‘partner requests it’) instead of supply-based aid (‘donor has an expert available’);

34. Urges the Commission and the Member States to recognise that energy consumption by the poor in developing countries does not, and for the foreseeable future will not, contribute significantly to global greenhouse gas emissions (1,3 % of global emissions by 2030, according to the IEA), and that in order to achieve a minimum acceptable standard of living their per capita consumption of modern energy services should increase without being constrained by climate change mitigation measures that are too strict;

35. Notes with concern that large hydropower infrastructure remains a focus for the World Bank and the EIB; recalls that experiences have shown that such projects do not necessarily increase access for the poor, but that this aim is better served through mini-hydro or micro-hydro power units for local demand, thereby avoiding the social and environmental drawbacks of larger projects;

36. Regrets the absence of sensitivity and banking capacity for small-scale energy projects on the part of the EIB, the European development finance institutions and the international financial institutions, and demands that they make universal energy access the focus of their engagement in the energy sector, also supporting small-scale and off-grid projects, particularly in rural areas, and integrating universal service obligations for the provision of universal energy access into their energy projects and grants;

37. Calls on the Commission and the Member States neither to fund nor to otherwise encourage the use of nuclear power in developing countries, given the serious security and sustainability concerns;

38. Recommends the work of the European Union Energy Initiative (EUEI), the EUEI Partnership Dialogue Facility (EUEI-PDF) and the Africa-EU Energy Partnership, welcomes the Energy+ Initiative and calls on the Commission and the Member States to step up participation and engagement in these initiatives, thus promoting international aid coordination in the field of energy;

39. Takes the view that the Rio+20 summit in June 2012 is an opportunity to propose concrete targets on how to abolish energy poverty and a roadmap on how to achieve them as a global strategy for greening the economy; calls on the Commission and the Member States to include universal energy access in the Rio+20 process;

40. Calls for the inclusion of universal energy access in the – yet to be formulated – post-2015 MDGs;

41. Instructs its President to forward this resolution to the Commission, the Council, the EEAS and the ACP-EU Council of Ministers.

Energy for All, Financing Access for the Poor, special early excerpt from the World Energy Outlook 2011, first presented at the Energy for All Conference in Oslo, Norway in October 2011; OECD/IEA, October 2011 (http://www.iea.org/papers/2011/weo2011_energy_for_all.pdf), page 3.